Ron Burkle’s Yucaipa Cos. filed suit Monday against former partner Lantern Capital, saying the Dallas-based private equity fund reneged on an agreement to reimburse Yucaipa for costs in the Weinstein Co. sale.
Yucaipa and Lantern were initially partners in a $500 million bid to buy the Weinstein Co. However, the deal collapsed amid a series of setbacks, including a discrimination suit from the New York attorney general’s office and the revelation of previously undisclosed liabilities.
Lantern then went ahead on its own with a deal to purchase the company in a bankruptcy sale. That deal closed on Monday morning for $289 million. According to the suit filed Monday afternoon in L.A. Superior Court, Lantern made use of confidential information it had obtained while partnered with Yucaipa.
Yucaipa contends that it agreed to allow Lantern to use the information in exchange for 2% of the purchase price, or $5.78 million, plus reimbursement of Yucaipa’s costs in connection with the failed purchase. According to the suit, Lantern has since refused to pay. Yucaipa alleges breach of contract, fraud and unjust enrichment.
Lantern has yet to respond to a request for comment.